Digital Turbine, Inc.

Good afternoon and welcome to the Digital Turbine fiscal second quarter financial results conference call. All participants will be in listen-only mode. Should you need assistance, please signal a conference specialist by pressing the star key followed by zero. After today's presentation, there will be an opportunity to ask questions. To ask a question, you may press star then one on your telephone key. And please note this event is being recorded. I would now like to turn the conference over to Brian Bartholomew, Senior Vice President, Capital Markets.

Please go ahead.

Thanks, Debbie. Good afternoon and welcome to the Digital Turbine Fiscal Year 2023 Second Quarter Earnings Conference Call. Joining me on the call today to discuss our results are CEO Bill Stone and CFO Eric Garrison. Before we get started, I'd like to take this opportunity to remind you that our remarks today will include forward-looking statements. These forward-looking statements are based on our current assumptions, expectations and beliefs, including projected operating metrics, future products and services, anticipated market demand and other forward-looking topics. Although we believe that our assumptions are reasonable, they are not guarantees of future performance and some will inevitably prove to be incorrect. Except as required by law, we undertake no obligation to update any forward-looking statements. For discussion of the risk factors that could cause our actual results to differ materially from those contemplated by our forward-looking statements, please refer to the documents we filed with the Securities and Exchange Commission. Also, during this call, we will discuss certain non-GAAP measures of our performance. Non-GAAP measures are not substitutes for GAAP measures. Please refer to today's press release for important information about the limitations of using non-GAAP measures, as well as reconciliations of these non-GAAP financial results to the most comparable GAAP measures. Now I will turn the call over to our Chief Executive Officer, Mr. Bill Stone.

Thanks, Brian, and thank you all for joining our call tonight. I know the vast majority of investors are currently focused on the macroeconomic environment and what it means for our business versus the micro operational details. And while I'm going to cover both in my prepared remarks, I'd like to begin by talking about the macro environment and what it means to us before diving into our results for the second quarter. The macro environment we've experienced over the last two and a half years has been the most dynamic I've seen in my 30-year career. It's required companies to operate lean while being nimble, flexible, and open to change. I want to focus my commentary on the current macro operating environment and what we are seeing regarding digital ad spending, devices, and operator and OEM focus areas. First on digital ad spending. At the headline level, and as many others have already reported, it has slowed. However, we believe that this is both temporary and also much more nuanced in the details, as many are painting all digital ad spending dynamics with the same brush. We believe this trend is temporary for a very simple reason. Since the beginning of the first ad dollar spends hundreds of years ago, continuing to today and ultimately tomorrow, Ad dollars have always followed where our eyeballs are. And today, our eyeballs are on digital devices, and we don't see that changing. In fact, we see that growing. So while there is some modest deceleration in the short term as advertisers figure out how to best optimize their spends in an inflationary and slowing macroeconomic environment, the dollars are there and will be there over the mid and long term. Also, we see a lot of nuance in the ad dollar spends. For example, platforms that have been heavily reliant upon Apple's historical IDFA identifiers and ad tech tactics like view through attribution have been disproportionately negatively impacted. Also, platforms that have a difficult time working with advertisers on the return on ad spend or ROAS metrics are also having a difficult time. We are also seeing a modest slowdown in U.S. device volumes as consumers decide not to invest many hundreds of incremental dollars on a new device, and some supply chain constraints exacerbate these trends in some markets. For example, here in the U.S., devices were marginally up sequentially, but declined by more than one million from a year ago. And finally, it's been well documented from many global operators and OEMs on their commentary on how they are trying to grow revenue in these type of macro environments. This is a tailwind for our business as they look for new revenue streams from companies like Digital Turbine, and I'll provide some specific examples of our success later in my remarks. The takeaway for investors is that we view this situation as temporary in nature. The macro conditions are more difficult compared to prior years, but not insurmountable or falling off a cliff. Unlike the macro situation that is currently more supply versus demand driven, The situation in our industry is more demand versus supply driven in the short term. OEMs, operators, and app publishers are looking for companies like Digital Turbine that can provide them with more dollars while demand sources are being more cautious and deliberate in their spends. The dollars and opportunities are still there, albeit more work and effort is required to capture them compared to prior years. Turning to our second quarter results, we had $175 million of revenues, $48 million of EBITDA, and $0.34 of non-GAAP earnings per share. In addition, we reported record gross margins of 52% and record EBITDA margins of 28%. This was our sixth consecutive quarter of EBITDA margin growth. As we have focused on margin accretive opportunities, and as Barrett will discuss in his comments, we are guiding today to make it our seventh consecutive quarter for this upcoming December quarter. And over those prior six quarters, we have delivered nearly three times the EBITDA that we did in the preceding six years combined. Non-GAAP gross profit margins improved sequentially from 50% to 52% compared to a reported margin of 48% in the second quarter of last year. Many companies struggle to increase margins in this current inflationary environment, and the ability for us to continue to show margin improvement is something we're proud of. And given the macroeconomic situation, focus is key. To that end, we are reorienting our headcount towards future versus legacy products, and specifically we're migrating portions of our legacy performance and reseller ad tech businesses towards more focus on growing things like the brand business and improving performance on leveraging single tap on our demand side platform, or DSP. This is having a short-term headwind on pro forma overall top line performance, but the changes should continue to help both our margin profile and sharpen our focus by doing fewer things better. For our on-device business, the drivers of those results were driven by more devices, more products, and more media relationships. And in particular, we added nearly 75 million devices in the June quarter, which compares to 68 million devices in the June quarter last year. This growth was driven internationally as U.S. device sales were down about $1 million year-over-year, or 1 million devices year-over-year. I was pleased with our continued improvement in revenue per device, or RPD. In the U.S., our RPD of over $5 per device was up approximately 15% year-over-year. We have RPD work to do internationally as we did not see the same year-over-year growth as the mix of devices was indexed higher in developing versus developed markets where RPDs tend to skew a bit lower. Here in the US, I'm pleased that we also extended our contract with Verizon for another four years as we continue to add new revenue streams and products with them. We also made progress on our single tap licensing product. We are on track to the update we provided at the last earnings call. But in particular, I want to call out some higher profile license relationships with Google, a tier one gaming publisher, and also a very large e-commerce provider with a large growing advertising business. Google will be selling our single tap licensing product in its Google Cloud Marketplace. This is yet another benefit of the strategic partnership we announced with Google in our joint press release last year. We also anticipate launching with the other two higher profile partners during this current quarter. Bigger picture for single tap licensing, the product market fit is very strong, and we're all excited about the prospects for single tap licensing, but I do want to remind investors that it will take time to get from executed agreements to material revenue generation. Similar to the early days of our dynamic install business where we launched with one mobile operator and with only a slot or two and then ramped and then added another and so on, it layered on nice sequential growth as we expanded the breadth and depth of our carriers and OEMs. I expect a similar trend to emerge with our single tap licensing business. We also have both some headwinds and tailwinds in our content media business. As we discussed on our last earnings call, we have been focused on improving the overall quality of our product for advertisers, while also prioritizing growth in our post-pay content media business activities, as we believe that longer-term growth is going to come from the post-pay market that has approximately 300 million subscribers here in the U.S., compared to approximately 75 million for prepay. And while our strategic shift to prioritizing growth from the post-pay content media business has resulted in short-term headwinds, on prepaid daily active users, our other on-device businesses would have experienced modest growth year over year. We have launched our post-pay Verizon Content Media Relationship and are now on 50 different device models. And as we ramp with Verizon, expand with AT&T, and focus less on this prepaid content revenue product, we expect our content media business to resume growth in 2023. On the app growth platform, or AGP business, While our year-over-year revenue growth was 6%, our gross profit growth was double that, driven by our 1DT synergies and our focus on higher margin products. The slowing in the macro digital ad spending of declining eCPMs is being offset with higher volume of impressions as we continue to add additional supply in the market. From a regional perspective, we continue to maintain a diversified global footprint. And in the current quarter, We saw impressions grow year over year across all of our major regions, with Asia Pacific showing particular strength. Looking at ad placement types, we have also maintained a balanced portfolio weighted between Banner, Interstitials, and Video. Banners have seen accelerated growth this past year with the continued expansion of the Digital Turbine Exchange and DSP. Video continues its growth trajectory, and remains the placement format we believe has the most future upside. We have work to do on the eCPMs on our performance and DSP business as that was below our internal expectations. But I was pleased to see sequential growth in our brand business as that is a strategic focus area for us and was a key driver of our ad colony acquisition. We have also made some strategic hires in our brand business over the past 60 days, so I'm optimistic we will continue to see momentum here. I was also pleased to see growth of double digits year over year in our Apple iOS business as we continue to improve our AI and machine learning and other larger players now have to compete on more of a level playing field with us now that things like view through attribution used by those large players is no longer supported by Apple. Turning to the future, I want to spend a few moments highlighting our growth drivers. I mentioned both single tap licensing and post-bake content media earlier in my remarks as strategic growth opportunities, but also as we've mentioned on prior calls, we want to build a Shopify for app stores on device. We believe we are uniquely positioned with our on-device technology, our publisher relationships, and our operator and OEM relationships. We also believe the pending global regulatory environment will provide additional thrust to this vision. And to achieve this vision, there are some market pain points we will be solving including making it easier for app publishers to port their apps into the new platform, managing payments, installing the applications, and managing curation of the microstores. On making it easier to port apps and manage payments, we took a first step in accelerating our efforts in this area by taking an equity position in an alternative app store called Aptoide, which has approximately 250 million users, 10 billion downloads, and over 1 million applications. Combining these capabilities with things like single tap will make installs easier for consumers. And we can further leverage our on-device position with Ignite to drive artificial intelligence and machine learning to focus on the right apps to the right features on-device versus the customer being overwhelmed and being dumped into a big app store with millions of applications to choose from. The alternative app stores will help us further leverage our ad tech assets with applications supported by in-app advertising revenue, but the app stores will also help us with our first foray into the in-app purchasing market, which is over a $100 billion global addressable market today. You will see us refer to this business as our hub business, and variants of the hub, whether that are things like Games Hub, Apps Hub, and so on. We anticipate launching our first integrated effort with a leading US operator in early 2023 and have received strong global market feedback from our strategy and approach. We're also making many organic product enhancements to our ad tech platform, including adding new ad units, new formats, new partners, new demand, improvements to our mediation, and new bidding methodologies. The historical ad colony and fiber businesses were very simple in their approach to both the gaming and single video format. That focus served them well, but also materially limited the market opportunity. We want to build on that success and have been busy building many new capabilities that are just beginning to launch in the market and should serve as nice growth catalysts and how we can cast a much wider net for the ad dollars that are out in the market. To accomplish all of these new growth areas, allocating resources will be key. I believe a competency of our business has been our resource allocation against our strategic priorities. Unlike many tech companies that overstaffed during the pandemic, we remained efficient and focused with each DT employee now contributing in excess of $200,000 of EBITDA, which would put Digital Turbine in the top tiers of profitability per employee across any industry, not just technology. On a pro forma basis, our total headcount is actually lower by approximately 20% compared to 2020 as a result of cost synergies and is lower today than a year ago at this time. But we've been able to simultaneously make new strategic resource investments against our priorities discussed earlier in my remarks. This disciplined approach to managing investments and expenses has been part of our culture since the beginning and is now serving us well as we see many others having to freeze hiring or lay people off neither of which we are doing at this current time. We are surgically hiring against our strategic priorities, include hiring a new chief technology officer, Senthil Kumran. Senthil joins us from Meta and brings us over 20 years of technology leadership in ad tech, telco, software, hardware, and product leadership. He's a very strong addition to our executive team and looking forward to his immediate contributions. And in conclusion, We are seeing some macro headwinds, but we believe they're temporary, and I know many investors are short-term focused, but we are very confident in our future and confident in the investments we are making to drive long-term value for Digital Turbine. With that, this concludes my prepared remarks, and I'll turn it over to Barrett to take you through the numbers.

Thanks, Bill, and good afternoon, everyone. Our Q2 results reflect our continued focus to deliver sustainable profitability as we make conscious efforts to expand our gross profit and EBITDA margins, even during these dynamic times. Before I begin, as a reminder, we passed the anniversary dates of our acquisitions made last year and will no longer refer to results on a pro forma basis. Revenue of $174.9 million in the quarter was down 7% year-on-year. Despite a softer ad market, our AGP business grew 6%, driven primarily by growth on the exchange platform. Our ODS segment was down 16% over prior year, largely driven by the near-term headwinds Bill discussed as we evolve our content media products, which were partially offset by the modest growth experienced on our app media products as North America RPD yields continue to expand. As I've mentioned previously, in this environment, global companies are facing headwinds driven by the trending strength in the U.S. dollar. Fortunately, foreign exchange rates have had only a modest impact on our revenues despite the macroclimate. This is due primarily to our current business model where we only have modest foreign exchange exposure given the majority of our revenues and expenses are nominated in U.S. dollars. Our margin expansion efforts enable gross profits to increase 1% to $90.5 million in and gross margin on the platform expanded to 52% in Q2, up from 48% as reported in the prior year, and up sequentially from 50% in Q1. While continued focus on margins enabled expansion across all our business lines, our ODS segment was an important driver in the year-on-year improvement. In addition to our core business expansion, we also experienced a benefit in the quarter from a renewed partner agreement that enhanced margins. And as a reminder, while gross margin rates can fluctuate from quarter to quarter, we generally anticipate long-term margin expansion as we continue to execute on our growth and synergy strategies. We continue to deliver cost efficiency on the platform. As cash operating expenses were $42.3 million in Q2, which were flat to prior year and represented 24% of revenues in the quarter. And total operating expenses were $67.7 million, which were also constant sequentially and lower compared to total operating expenses of $72.7 million in the prior year. While we remain disciplined with operating expenses, the realized efficiencies in our cost structure have enabled funding measured investments focused on our teams, our infrastructure, and new growth priorities. These near-term investments are anticipated to drive continued benefits to be realized over the coming quarters to further improve our efficiency and our operating leverage. Our adjusted EBITDA of $48.2 million in the quarter increased 1% over prior year, and our EBITDA margin expanded to 27.6, up approximately 200 basis points over the prior year. and we're pleased to deliver in Q2 our sixth consecutive quarter of sequential EBITDA margin expansion. I'm proud of the durability of our operating model and our EBITDA growth and margin expansion that is all being achieved, especially in a challenging macro environment. I continue to be pleased with our profitability and free cash flow delivered in our business. In the quarter, we achieved non-gap adjusted net income of $35 million, or $0.34 per share as compared to a $45.3 million or $0.44 per share in the second quarter of last year. While income from operations improved over prior year, we incurred greater interest expense driven by rising rates partially offset by reduction in our debt balance. We have higher taxes relative to Q2 in last year. As expected, primarily driven by lower tax benefits from stock-based awards and greater income in foreign jurisdictions. Our GAAP net income was $11.7 million, or 11 cents per share, based on 103 million diluted shares outstanding, compared to prior year net loss of $5.9 million, or a loss of 6 cents per share. Healthy free cash flows for the quarter of $22.4 million enabled us to exit the quarter with $82.7 million in cash after paying down $26 million in debt using our free cash flows from operation to further deleverage our debt position. Our debt balance ended the quarter at $450 million drawn on our revolving credit facility, and as our business continues to produce strong free cash flows, we would expect to continue to pay down our revolver. We are confident in our balance sheet and our capital position, given our profit model with expanding margins, strong cash flows, and access to low-cost credit facility. While we expect these market conditions to be temporary, we are well positioned to resume to stronger growth when the macro landscape improves. Now let me turn to our outlook. As we consider the ongoing uncertainties in the macro environment, we currently expect revenue for Q3 to be between $180 million and $190 million. and adjusted EBITDA to be between $53 and $57 million, and non-GAAP adjusted net income per diluted share to be between $0.36 and $0.39, based on approximately 104 million diluted shares outstanding and an effective tax rate of 25%. With that, let me hand it back to the operator to open the call for questions. Operator?

We will now begin the question and answer session. To ask a question, you may press star then one on your telephone keypad. If you are using a speakerphone, please pick up your handset before pressing the key. To withdraw your question, please press star then two.

At this time, we will pause momentarily to assemble our roster. The first question comes from Dan Day with B Reilly Securities.

Please go ahead.

Yeah. Hey, guys. Appreciate you taking the questions. So if I'm doing the math right, just based on a couple of the things you provided in the prepared remarks, it would seem that content media revenue is down a little over 40 percent with this transition to postpaid in mind. So maybe if you could just first, if you could just confirm that's about right. And then if you could just walk investors through the expected revenue ramp. how long you think it should get back to the pre-transition levels, where we are with the Verizon AT&T potential partnerships, and then whether you might get some of the business from T-Mobile that has been lost on the prepaid side back on their postpaid side at some point.

Yeah, thanks, Dan. Hey, just on the numbers, yeah, we did reference – we don't break out the content specifically, but this segment we report ODS – It was, we did reference it. It was impactful. Overall, excluding our content business, you know, our app media business was up slightly. I'll let Bill address the strategic point.

Yeah, yeah, sure. Hey, Dan. The first thing I'd say is just as a reminder for us, you know, 80, between 80 and 90% of our revenues of our company come from something other than this. just for context, but as it relates to content media specifically, yeah, we've been really beginning to focus a lot more on the post-pay product. We want to get better quality for our advertisers and really get after the broader market that goes with post-pay. So we've been really focusing our resources on deploying that. And as I mentioned in my remarks, we're starting to see some nice traction with that. Now we've got to turn that nice traction and engagement into revenue, which is what we expect to happen as we get back into 2023. But that focus has negatively impacted our prepaid business, and so we've seen some declines in daily active users as a result of that. But we expect that to resume as we get into 2023. Awesome.

Thanks, Bill. And then one other thing, you talked in the prepared remarks about sort of this delay between when you get the licensing deal, when it starts to generate material revenue, and I think like the perception from some investors is, you know, you're going to strike these deals and then they turn it all on the platform and then the money starts blowing in. Clearly, it's more complicated than that. So maybe if you just walk us through why that is and so we can understand, you know, a little better why there might be a delay between, you know, getting a deal and single tap revenue coming in.

Yeah, sure. You know, I think one thing that's important for investors to understand about single tap is really an enablement capability thing. And we've got four different types of revenue streams that we have off Singletap. We've got it in our DSP business. We run it through our legacy ad colony business. We've just integrated it into our fiber exchange business. And then the fourth part is the licensing business that's attracted a lot of investor attention in a market we're excited about. In that fourth part of it, I really just view this very similar to when we started the dynamic install business many, many years ago, where you start with one material player, you get going, then that player wants to expand to do more and more, whether that's in more geographies or more ad types or whatever happens to be in this case, and then continue to expand it to other providers. But you go deeper with the ones you've got, you go broader with new ones. But I think that kind of sequential growth is something that we just want to make sure we manage expectations. We're very excited about it. We've run the models. We know what it looks like internally. We think this could be really big. But at the same point in time, we don't want to get over our skis in terms of managing expectations on it because there are a lot of last mile operational issues that are associated with getting this thing going and ramped. And that's where we're really focused right now.

Okay. That's all I had, guys. Appreciate you taking the time. Best of luck. Thanks, Dan.

Next question is from Darren with Roth Capital Partners. Please go ahead.

Hey, guys. Thanks for taking my questions. Nice job on the cash flow. Could you just kind of give us an update, Bill, with everything that's kind of going on with Europe, just the Samsung SKUs, the relationship there? Are you guys seeing any better traction than kind of your commentary last quarter. And then my second question on, on the licensing business for single tap, um, you, you mentioned some, some tier one wins and in Google cloud, like, do you feel like you've finally hit an inflection point or this is going to be more of a roller coaster ride? Um, maybe like the early days of dynamic install. Thanks.

Yeah, sure. Thanks, Darren. Yeah, so first on the devices, I was really pleased in this environment, you know, to have 75 million devices put on the board. I think that's a record for us, you know, all time in this environment. And as I mentioned in my prepared remarks, you know, the vast majority of that was internationally, which obviously Samsung is a major contributor, I believe the largest contributor, you know, of all of those around the world. So we're pleased with that. And we're going to look to continue to expand that number. I think one of the things that negatively impacted not just us, but everybody during COVID was, you know, working a lot of these different kind of global relationships to add more supply. And we're starting to see, you know, kind of a rethink of that as operators and OEMs are looking for new revenue streams. And so, you know, obviously we provide that to them. So, you know, I'd expect to see continued traction and momentum on that. Regarding the inflection point question, yeah, I think we're at a point now where, you know, we've taken this from a great idea to now getting signed contracts, seeing a little bit of revenue roll in. But, you know, as I mentioned to Dan earlier, you know, we just want to make sure we temper expectations. You know, we're excited about it. We do think we're at an inflection point, but, you know, we want to make sure that, you know, we manage expectations around it so we don't get over our skis. And, you know, those are things and mistakes we made many, many years ago in the past. Back to your reference on the dynamic install business. And so we want to make sure we don't repeat that. So, you know, we'd like to continue to focus on how we can, you know, under promise and over deliver there.

If I could sneak in one more maybe for Barrett, your comments about the leveraging, like what's your kind of general rule of thumb about cash, free cash flow generation relative to kind of debt pay down?

Yeah, so our view on our long-term EBITDA conversion to free cash flow hasn't changed, right? We still view that as the 70% to 80%, just given the nature of our financial engine. So at that rate, you could assume that we don't have a lot of assets that we're going to be investing in. And so if there's not an opportunity, turn that free cash flow, we direct that towards paying down our debt. So, Darren, you can take the 70% to 80% over the year and apply that to debt pay down.

Thanks, Bert.

The next question is from Omar Dasuki with Bank of America. Please go ahead.

Hey, guys. Thanks for letting me ask the question here. I just wanted to ask about any progress on the single tap fiber integration. You know, I'm wondering if that is launched and if there's anything worth calling out in terms of flows and demand that you're seeing there.

Yeah, sure, Omar. Yeah, so we've soft launched it and we've enabled it. You know, right now we're pressure testing it with the DSPs that plug into fiber, and we want to make sure we've got that right relative to our own DSP performance. And so we're doing a lot of kind of A-B testing around that to make sure that it's meeting their expectations in terms of return on ad spend versus just sheer number of installs. So I'd say we're being pretty cautious with it, but we're very excited about it.

And do you have any sense of when we might be able to see incremental revenue from that in next year?

Yeah, I would expect as you see us get into future quarters, we're going to see incremental revenue from that. Absolutely. Got it. Thank you.

The next question is from Anthony Stoss with Craig Helm. Please go ahead.

Congrats on the nice margins. Bill, just getting back to Singletap for a second here, I know there's been a lot of custom work for a bunch of these Tier 1s. Have you learned a lot through this process where you can potentially onboard other Tier 1s much quicker? And I'm curious if you think you can take on several new launches per quarter. And then I had a follow-up on Aptitude after that.

Yeah, sure. Hey, Tony, thanks. Yeah, we're working on that right now. That's a major focus area. You know, some of the stuff I'll call it, it's not necessarily the sexy stuff in terms of announcing some of the larger deals is in the implementation. And what we've learned. in the early days when we launched with Verizon and Samsung and AT&T in our dynamic install business, that last model of execution and how you scale that last model of execution is just critical to success. And so, you know, we're absolutely working on how we automate and we've learned a lot for that versus getting into a variety of bespoke solutions. But we do have to work to integrate with these partners And so the work isn't necessarily difficult. The work just has to get integrated into their existing processes. And that's something that I think would probably spend the hardest thing for us, you know, in terms of taking the time to get going. But I think we're making some material progress against it. And, you know, very excited to see how this business can play out for us in 2023. Got it.

Thanks for that. And then, Bill, you seem pretty excited about this combo after a launch in early 2023 with a U.S. operator. Any more detail you can share or maybe the revenue impact? And then I wanted to sneak in one for Barrett, just kind of thoughts on gross margins, you know, higher next year, fiscal year than this year still?

Yeah, so as we think about the alternative app store space or work on our hub internally, you know, we think there's a real opportunity for curated app stores. Just like in our regular world today, we'll go to Amazon and buy stuff in the e-commerce world. But we also see things in our local stores that are powered by Shopify that are maybe more curated for our own personal experiences. And given our unique position on device, We think we've got a really good at-bat here to not just leverage our ad tech assets for in-app advertising, which we're doing, but also it's our first foray into in-app purchasing. And as I mentioned in my remarks, that's a $100 billion market. So if you can think about us now collecting dollars in terms of acquiring new users, collecting dollars for the advertising inside those apps, and now expanding that to another dimension with the in-app payment piece of this, I think that adds a nice revenue growth opportunity for us. And so we're going to get this going off the ground early next year. But I think the thing that also will be exciting now that we're getting over midterms is how the regulatory environment goes. We see all the Digital Markets Act in the EU just get passed, and it's in the process of getting implemented. I expect to see now some legislation getting going here in the U.S. as bipartisan support that could be a real nice tailwind and thrust to our activities in the space.

Got it, thank you.

The next question is from Arthur Chu with BOFA Security.

Please go ahead.

Oh, hey, thanks for taking my question. Actually, my question was just asked by Omar, so no worries.

Thank you, guys.

This concludes the question and answer session.

I would like to turn the conference back over to CEO Bill Stone for any closing remarks.

Yeah, thank you all for joining the call today, and we'll look forward to reporting on our progress against all the points we made on today's call. We'll talk to you again on our fiscal 2023 third quarter call in a few months. Thanks, and have a great night.